The following commentary was sent to Sonoran Alliance but was published in Sonoran News. We thought we’d also post it for your information and discussion. We also invite a representative from Arizona Tax Revolt to also send us information.

Dueling tax initiatives – Prop 13 Arizona versus Arizona Tax Revolt 

By Linda Bentley

ARIZONA – If both Prop 13 Arizona and Arizona Tax Revolt are able to collect at least 230,047 signatures by July 3, 2008, both initiatives could make the November 2008 ballot.

Although both initiatives claim to be modeled after California’s Proposition 13 passed by voters in 1978, Prop 13 Arizona’s language most closely mirrors the California initiative.

Prop 13 Arizona lays out a simple plan to:
    • Roll back property valuations to 2003 assessed full cash value or actual purchase price if after December 31, 2003.
    • Cap total tax at .5 percent for all residential property and at 1 percent for all other classifications of property.
    • Limit valuation increases to no more than 2 percent per year.
    • Eliminate exceptions (Secondary Taxes) to the .5 and 1 percent tax caps.

Arizona Tax Revolt appears to have two initiatives; one to rollback tax levies and the other to rollback valuations. The pair of initiatives, consisting of about nine pages of complicated verbiage, although they may have been inspired by California’s Proposition 13, do not appear to have all that much in common with the California initiative.

It too rolls back property valuations to 2003 but it caps taxes at 1 percent for all property and does not reasonably address how valuations would be calculated for property purchased thereafter.

Nowhere on its website www.ArizonaTaxRevolt.org does it spell out, in simple language, the mechanics of the initiative, nor do the brief descriptions posted on the Arizona Secretary of State’s Website.

Although the website, www.Prop13Arizona.com, is still a work in progress, the home page clearly states what the initiative will accomplish, while the full language of the initiative encompasses just a little over one page.

The California initiative was followed as closely as possible because it has survived challenges all the way to the U.S. Supreme Court, where it was declared constitutional in 1992.

Prop 13 Arizona so simplifies the methods for calculating valuations and taxes, it could conceivably do away with the assessor’s office altogether.

Neither of the initiatives eliminates the senior valuation protection.

However, the best way to determine how each initiative will affect property taxes is to look it up on the assessor’s site www.maricopa.gov/assessor, and click the link that says “View Tax Information” to see the current and historic taxes on the property.

From there, click the menu item near the top of the page for “Valuations,” then select 2003.

Take the full cash value and multiply it by 1 percent for Arizona Tax Revolt and by .5 percent for Prop 13 Arizona.

The results are going to be a mixed bag, depending where the property is located.

In Phoenix, after dramatic property tax increase from last years bond propositions, both initiatives could result in lowering taxes. Obviously Prop 13 Arizona, at .5 percent would have a lower result than Arizona Tax Revolt at 1 percent.

However, let’s say the property is in the unincorporated county island and the current tax for 2007 is $1,541. Using the 2003 rollback year with a full cash value of $282,500 and Prop 13 Arizona, taxes would be $1,412.50, a moderate savings of $128.50.

Using the same parcel and Arizona Tax Revolt, taxes would nearly double to $2,850, an increase of $1,309.

And, because Arizona Tax Revolt does not eliminate exceptions, taxes only stand to increase from there.

A home in north Scottsdale with 2007 taxes of $1,910, using Prop 13 Arizona would be reduced to $1,625, a savings of $285.

That same home, using Arizona Tax Revolt, would raise taxes to $3,250, an increase of $1,340.

In most instances, Arizona Tax Revolt would raise residential property taxes significantly.

Under “Frequently Asked Questions” Arizona Tax Revolt’s Website states, “… taxpayers benefit by lower tax increases.” However, in most instances, that would not occur until after an initial near doubling of the taxpayer’s current bill.

Prop 13 Arizona will lower taxes moderately for most at inception and limit increases thereafter, with no exceptions.

Do the math and then choose the initiative.

If both should make the November 2008 ballot, the initiative receiving the most votes would be implemented.